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Police Commission Supports Taxi Fare Increase Request; Council To Decide How Much Of A Hike In May

OCEAN CITY – Due to a rise in costs, some city officials are throwing their support behind a taxi fare increase with the issue headed to the full Mayor and City Council for discussion this month.

The Police Commission held a meeting with Ocean City taxi medallion owners on Monday morning to work toward a recommendation of a proposed taxi rate increase to the full Mayor and City Council. In the next few weeks, the matter will placed on the Mayor and City Council’s agenda where the floor will be open to the public for comments.

The Town of Ocean City’s code states, “Charges for transportation … must be computed by taximeter charging an amount not to exceed the rates recommended by the Police Commission and established through a resolution of the Mayor and Council. A taxicab driver may discount the fare, but no other charges may be added to the established rates to compute a fare.”

Currently, in Ocean City, there is a $3.20 initial fare for taxi customers plus $2.20 per mile after, representing Ocean City’s policy to charge 22 cents per 10th of a mile. The fare was last updated in 2010.

In February, Nite Club Taxi Manager John Donohue publicly outlined reasons for wanting to increase the per-mile rate charged to customers before the Police Commission.

Donohue explained currently taxi cab drivers share the per-mile rate 50-50 with cab owners, which is $1.10. However, drivers are also responsible for fuel with owners accountable for maintenance, advertising and insurance. Donohue recommended increasing the per-mile rate to $3, which is a 36-percent increase.

Donohue returned to the commission in March providing research conducted by Norman Mullinix of At the Beach Taxi, LLC. Using information provided by the Bureau of Labor Statistics, Mullinix compared the price of fuel and cost-of-living between 2009 and 2013.

In 2009, the average gas price for the year was $2.34 compared to the average gas price for the year in 2013 of $3.52, a $1.18 increase, or 50.5-percent. The increase of grocery prices and electricity, or the average cost-of-living increase today is 18.68-percent or 41 cents, he maintained.

“The numbers support our request of a taxi rate increase based on today’s economy to be $3.70 a mile,” he said.

Following Donohue’s presentations, the Police Commission decided to hold a meeting with taxi medallion owners.

On Monday, the majority of taxi medallion owners present were in consensus on a taxi rate increase with two of the three largest taxi fleets in Ocean City being the voices of opposition.

“We strongly feel that the rate as it stands now is a win-win situation for the taxi medallion owner and taxi driver,” said Ralph DeAngelus of Taxi Taxi and City Cab, who owns 26 taxi medallions. “We believe we make a fair profit at the rate it stands now. We have spoken to our drivers and they believe they make a fair earning at the rate it stands now. We believe that the consumer pays a fair rate to get from their beginning and ending destination.”

DeAngelus voiced concern over the long-term effect an increase would have on consumers.

“What we are worried about is if it gets so overpriced that that person that says they will be the designated driver … has a couple drinks, a couple of drinks always lead to a couple of extra drinks, and now because the decision process went from, should we pay that exorbitant fare to ‘ok I can drive’, leads to potential more intoxicated people on the roads and no one needs that,” DeAngelus said.

Michael Pawlowski of Nite Club Taxi and Sunset Taxi, which owns 27 medallions, recommended raising the fare to a maximum of $3.70 per mile, reasoning the costs of operations have increased over the past 10 years.

“Ten years ago when we started using meters, we were charging $3.50 per mile, and we didn’t have any complaints,” he said. “What I want to suggest is we can give discounts to our local customers or the people who ride with us all summer. Why not? If some companies are against it [rate increase], then they can give 50 percent off, but please don’t hold us to a really low rate. It is the lowest rate I have seen.”

Nelson Stepanyan of Coastal Taxi, which owns 10 medallions, pointed out taxi drivers make a reasonable living three months out of the year but those who remain in the resort year-round struggle to survive.

“I understand $3.70 would be a big jump but my suggestion is that we do it in a two-year or three-year break down to bring it to market value,” he said.

Carl Kufchak of Ocean City Taxi, which is the largest taxi operation in Ocean City owning 32 medallions, is concerned the talk of a taxi fare increase alone is going to scare consumers out of cabs.

“We do not want to chase customers away by raising these rates … you are scaring people out of the cabs,” he said. “Keep the rates the same for every company because if not, then you run into problems … I am against discounting. I am against one company charging this and another company charging that. Then people feel like they are getting ripped off. The meters are here for a reason. It is so everybody makes a fair and equitable share of the market.”

Pawlowski agreed all cab companies should charge the same rate on the meter to avoid confusion. However, those companies opposed to a fare increase are entitled to give a discount.

“Please do not keep us from increasing the prices … for all the little people, those who have one, two, three or four cabs … every single one want an increase. Just give them the chance because it is a free country and I think they deserve free enterprise to be increased, and if our competitors want to charge less than do that,” he said.

Stepanyan added the current rate will continue to drive the small cab companies to sell their medallions to the larger fleets.

“In a few years, there is going to be even more problems because there will only be a few big companies and it is going to be much harder to negotiate with them … you [town] won’t have authority with three companies because they will have all of the business,” he said. “We are going to push the smaller ones out if you don’t give a raise.”

On Tuesday, Police Commission Chair Doug Cymek said the commission is in consensus that some sort of adjustment to either the taxi fare or initial fee is called for and will forward the matter to the full Mayor and City Council for a formal discussion as well as allow for public input.